Koh Thong Sia ("Koh"), a 57-year-old sole proprietor of two businesses that provide quantity surveying services, First Survey & Engineering Services and First Survey Consultants, has been convicted of evading Income Tax and failing to register for Goods and Services Tax (GST).

Koh faced two charges of making false entries in his Income Tax returns with wilful intent to evade income tax by under-declaring about $1.1 million of his trade income in his Income Tax returns for the Years of Assessment (YAs) 2010 and 2011, resulting in $186,883 in income tax being undercharged.

Koh also faced one charge for failing to notify the Comptroller of GST of his liability to be registered for GST when the taxable supplies for both his sole-proprietorship businesses exceeded the $1 million threshold by the end of the quarter ending 31 March 2009. As a result, he had failed to account for GST amounting to $118,201.

Court Sentences
For the two proceeded charges on Income Tax evasion, the Court sentenced Koh to 3 weeks’ imprisonment. In addition, the Court ordered Koh to pay a penalty of $560,648, which is three times the amount of income tax evaded.

For failure to register for GST, the Court fined Koh $4,000 and ordered him to pay a penalty of $11,820, equal to 10% of the GST due.

Penalties for Non-Compliance

IRAS Warns Against Tax Evasion

IRAS takes a serious view of non-compliance and tax evasion. There will be severe penalties for those who wilfully evade tax. The authority will not hesitate to bring offenders to court. Offenders may face a penalty of up to four times the amount of tax evaded. Jail terms may also be imposed.

GST Registration
All businesses, including individuals deriving income from their trade, profession or vocation, should closely monitor their turnover on a calendar year basis to assess if they need to register for GST. If their 12-month taxable turnover exceeds $1 million at the end of a certain accounting period, they will be required to apply for GST registration within 30 days from that date.

Any business that fails to register for GST is still required to pay GST on all their past transactions from the date the business became liable for GST registration. GST is payable even if the amount was not collected from customers. In addition, failure to register for GST is an offence and businesses may be required to pay a penalty of 10% of GST due, and fined up to $10,000.

Cash Rewards for Informants

A reward based on 15% of the tax recovered, capped at $100,000, would be given to informants if the information and/or documents provided lead to a recovery of tax that would have otherwise been lost. All payments are at the discretion of the Comptroller. IRAS will ensure that the identities of informants are kept strictly confidential.   

Reporting of Malpractices

Businesses or individuals are encouraged to immediately disclose any past tax mistakes. IRAS will treat such disclosures as mitigating factors when considering action to be taken. Those who wish to disclose past mistakes or report malpractices can write to:   

Inland Revenue Authority of Singapore
Investigation & Forensics Division
55 Newton Road, Revenue House
Singapore 307987   

Email: [email protected]

Inland Revenue Authority of Singapore